Set Aside Money

all done. Now, I need to know - rules about set aside $.. I know the basics...My question is what happens if I use the money for something besides worker comp medical issues. Example - RENT! The system has put me in this place. A terrible place to be. I do understand that they will not pay any medical bills until I have used the set aside money for the purpose it was intended. But, I have to deal with todays problems today! I have checked with an attorney- they just tell me what they have to say! Any advice will be appreciated.

Re: Setaside$

The fact you are no longer in need of future medical treatment does not mean you are free to use the MSA money any way you wish.
In fact, up until about a year or so ago, CMS had provisions where the IW could request a reduction in the MSA of 25% based on medical evidence and statements from your treating physicaians. That ability no longer exsists. You cannot get any money paid directly to you as a reduction in the MSA.

When you have a WCMSA, that is an allocation in your settlement. Your entire settlement dollars could be declared as future medical reimbursement if CMS takes the stance you have attemtped to shift liability for your treatment to Medicare.

There is no ''law'' that precludes you from using that money for other non-Medicare purposes, however, you are required to self attestation every year to CMS/Medicare and show how you have spent that MSA money.

I have checked with an attorney- they just tell me what they have to say!

Which was what ?

What is to prevent a self-administrating beneficiary of a Medicare Set-Aside fund from using the money for non-medical related expenses? Is there an accounting protocol and/or what are the sanctions for misuse?

Unfortunately, the only penalty for the misuse of MSA funds is the threat of denied Medicare benefits until the beneficiary demonstrates that he properly exhausted the set-aside funds on Medicare-covered medical expenses related to his insurance claim. Given that CMS has the statutory right to provide conditional payments even when the Medicare Secondary Payer (MSP) statute prohibits the payment in order to insure that treatment is received, I don't think that's realistic from a public policy standpoint. But as the Medicare trust fund continues to shrink, perhaps it will (as it should) to preserve the longevity of the program.

From an attorney or insurer standpoint, I would be extremely cautious knowingly entering into a settlement where Medicare will not be adequately protected given the claimant's intent to misappropriate the funds. Perhaps you should give serious consideration to custodial administration of the funds. There is an associated cost but the insurer may be willing to consider it rather than give CMS any opportunity to claim that the burden of future medical care was intentionally shifted, quite possibly disregard the entire settlement pursuant to 42 CFR 411.46, and continue to seek payment from it as the primary payer even after the state has approved the settlement.

You received a lump sum settlement from your comp claim, where is the indemnity money included in the allocation ?
And/or the non-MSA money allocation...that money you can use as you see fit...any treatment Medicare does not normally pay for is out of your pocket, that's what the non/MSA money is to cover.

Re: Setaside$

The fact you are no longer in need of future medical treatment does not mean you are free to use the MSA money any way you wish.

That's not what I said.
I said "As long as you no longer need future medical, you'll be fine."..meaning there will be no penalties other than their refusal to pay medical.

By not having medical expenses, you are "protecting Medicare's interest"
The courts have held that Medicare’s interest (MSA'S) become an issue, only if you have injury related medical expenses.
As long as there are no medical expenses, Medicare has no interest.

You don't need "money paid to you" you already have it in your posession, it was paid to you in your settlement.
Trust me, if Medicare had a right to it, it would've been direct deposited to them.
That money is YOUR money, it was a part of Your total settlement, of which attorney fees where calculated, it wasn't additional.

In my book, this setaside scam is just that.
Because Medicare refuses to pay, the money is owed to the doctors, not medicare.
Medicare is acting as collection agency for the doctors.
They are attempting to collect payments for money not due to them, but a private entity.

They even go the extra mile and say you must pay in advance.
If they feel they aren't responsible for an expense, simply don't pay and let the doctors pursue the charges on their own.
It even says on the bill, when you go to the docs "you are reponsible for any charges not paid by medicare"
It says nothing about you must pay the bills in advance.
No other private industry has government enforcing collections for them.
The most Medicare has a "right to" is to set deducables before they pay, to do other, is out of their boundries.
This is why you'll never see Medicare pursue repayment for a depleted setaside, they have no legal right to (unless they paid the bills) of which they don't.
Tony

Last edited by tony; 01-01-2010 at 07:40 AM.

ModeratorResponses are based on my personal bias, experience and research - they may not be accepted in the legal community, always consult an attorney.

Re: Setaside$

Medicare isn't collecting any money, or making sure there is a guarantee doctors or any other provider is paid.

Future medical care is the IW's money... Medicare is making sure that money is available to pay where Medicare otherwise would...it is illegal for the parties in a comp or PI claim to shift the liability to Medicare/taxpayer.

Why should any injured party, comp or PI be compensated up front for medical costs associated with their injury and then expect Medicare to pay too...? THAT is double dipping.

When you close out a claim that includes medical care, you are provided a lump sum to compensate for your out of pocket costs. CMS is making sure that a portion of that money is avaliable to pay those bills.

When Medicare is a Secondary Payer to a Workers' Compensation (WC) Plan
Pursuant to 42 U.S.C. §1395y(b)(2) and § 1862(b)(2)(A)(ii) of the Social Security Act, Medicare is precluded from paying for a beneficiary's medical expenses when payment "has been made or can reasonably be expected to be made under a workers' compensation plan, an automobile or liability insurance policy or plan (including a self-insured plan), or under no-fault insurance."http://www.cms.hhs.gov/WorkersCompAgencyServices/02_workerscompensationoverview.asp#TopOfPage

That means the IW when they accept the lump sum payment, IW becomes primary to Medicare.

It even says on the bill, when you go to the docs "you are reponsible for any charges not paid by medicare"
It says nothing about you must pay the bills in advance.
No other private industry has government enforcing collections for them.
The most Medicare has a "right to" is to set deducables before they pay, to do other, is out of their boundries.

That may be true when you are talking about your personal health care, or Medicare supplemental...no one pays up front. There are share of costs associated with Medicare and those primary to Medicare carriers. In WC, you assume the liability yourself when you take that lump sum payment.

For those IW's not receiving SSA/SSDI/VA there is no need for a WCMSA. But you still have to pay out of pocket for medical before any other carrier will pay...that too would be double dipping, and that's where the 'fraud against an IC' comes from...allowing another party to pay the bill when you have accepted money up front.

That's not what I said.
I said "As long as you no longer need future medical, you'll be fine."..meaning there will be no penalties other than their refusal to pay medical.

Doesn't matter. There is no way you're going to get that money out of a MSA to spend any way you like, without accounting to CMS/Medicare. There is no way to say you won't require further medical treatment to your injury unless you are dead. Then the MSA money will/can be paid to your estate. FMC money is not part of an award for being injured ...that's what indemnity money is paid for. Zero PD rating...no award, obviously no future medical money paid.

They even go the extra mile and say you must pay in advance.

Where please ?

By not having medical expenses, you are "protecting Medicare's interest"
The courts have held that Medicare’s interest (MSA'S) become an issue, only if you have injury related medical expenses.
As long as there are no medical expenses, Medicare has no interest.

And that would be determined PRIOR to settlement of future medical expenses. There would be no MSA if there are no anticipated medical needs, that Medicare would normally be responsible for. Not all claims require a MSA.

How is a MSA a scam ? If the IW spent all the FMC money, money intended to be used for further medical treatment, who would pay the bills for FMC ?
You know Medicare would pay... likely through the Medicade portion...which is welfare. Why should the taxpayer be liable for an IW's medical when the IW has spent the money elsewhere ?

(Ref: 7/23/01 Memo)
The purpose of a Workers' Compensation Medicare Set-aside Arrangement (WCMSA) is to pay for all services related to the claimant's work related injury or disease, therefore, Medicare will not make any payments (as a primary, secondary or tertiary payer) for any services related to the work-related injury or disease until nothing remains in the WCMSA. These arrangements are established in order to pay for all medical expenses resulting from work-related injuries or diseases; they are not designated to simply pay portions of medical expenses for work-related injuries or diseases. When WCMSAs are designated as lump sum commutations (i.e., the WCMSA is designated in a manner that the WC settlement is paid into the arrangement all at once), Medicare would not make any payments for the claimant's medical expenses (for work-related injuries or diseases) until all the funds (including interest) within the WCMSA have been completely exhausted. These same basic principles also apply to structured settlements.

Generally, WCMSAs that are lump sums (i.e., the WCMSA is funded by the WC settlement all at once) present less of a problem to monitor than structured arrangements. Medicare would not make any payments for claimants that possess lump sum arrangements until all of the funds within the arrangement have been depleted. For example, if a set-aside arrangement were established for $90,000, Medicare would not make any payments until the entire $90,000 (plus interest, if applicable) were exhausted on the claimant's medical care (for Medicare covered services only). http://www.cms.hhs.gov/WorkersCompAg....asp#TopOfPage

The MSA should have allocations... CMS approved money, and NON-MSA money. That non-MSA money you can use any way you like. It is not accountable to CMS.

Re: Setaside$

BvIA

Medicare is making sure that money is available to pay where Medicare otherwise would...it is illegal for the parties in a comp or PI claim to shift the liability to Medicare/taxpayer.

I think they did that when they deducted all of that money over the years when we where working.
It's impossible to "shift the liability to Medicare/taxpayer."
Medicare has a policy of not paying for up to the amount of the settlement.
Show me one case where medicare paid when a setaside was mismanaged, you can't because they don't.

Why should any injured party, comp or PI be compensated up front for medical costs associated with their injury and then expect Medicare to pay too...?

Exactly my point. When there's no medical due or pending and the injured worker is refusing future medical, where does medicare have an interest? They don't.

Also, injured workers are not "compensated up front for medical costs associated with their injury"
There is no seperate settlement for future medical.
This is why you see time and time again of people complaining that the setaside is more than their settlement

That money for the setaside comes out of their wage loss settlement.
That's why the attorney fees are based on the percentage of the total settlement.
I've never heard of or seen a settlement that's worded "future medical***** dollars."
That would be loveley though, it would save alot of hassles and the injured workers would get a fair shake.

There is no way to say you won't require further medical treatment to your injury unless you are dead.

Bull, I know of plenty of people who haven't seen a doc in 15 years after closing their case. Future medical basically means pain pills and shots, alot of people can get by without them.
By the time most people settle, thay are sick of the doctors and the entire system, they want to be left alone.

You can spin it any way you want, if there's no medical, medicare has no interest.
The bottom line, the only remedy they have if you do spend the money, is to not pay for up to the amount of the settlement.
Tony

Last edited by tony; 01-01-2010 at 11:02 AM.

ModeratorResponses are based on my personal bias, experience and research - they may not be accepted in the legal community, always consult an attorney.

Re: Setaside$

Also, injured workers are not "compensated up front for medical costs associated with their injury"
There is no seperate settlement for future medical.
This is why you see time and time again of people complaining that the setaside is more than their settlement
I've never heard of or seen a settlement that's worded "future medical***** dollars."
That would be loveley though, it would save alot of hassles and the injured workers would get a fair shake.

Lets keep the discussion to those claims that include indemnity and future medical costs/allocations where there is a lump sum settlement. As that would be the ONLY time a WCMSA is necessary.
If the treating physicians haven't indicated FMC is necessary, there would be no money for future medical, or need of a WCMSA.
Any atty or IW who does not have allocations in a lump sum settlement is not looking after the IW's best interests.
Only would the settlement have higher medical values is when the indemnity has been paid out prior to the medical portion, or If the future medical is greater in estimation than the pre determined number of weeks associated with the rating. Which IMHO would be rare.
For CMS/Medicare purposes there must be allocations for indemnity and future medical, including the MSA dollars and the non Medicare dollars. So to say there are no settlements that include up front compensation for future medical treatment is simply not true.

I've never heard of or seen a settlement that's worded "future medical***** dollars." See page 7 of 9 here http://www.dir.ca.gov/dwc/FORMS/EAMS...Form10214c.pdf, this is a Compromise and Release agreement in the State of Calif whereby the parties agree to the issues being settled in the C&R... ''future medical care'' is specifically listed. It's important in any C&R for there to be allocations made to ensure CMS/Medicare does not come back later and declare the entire award/settlement to be for medical reimbursement.

When the IW closes out the medical in any claim they are assuming liability for FMC out of pocket... when FMC is indicated by the treating physican, there must be payment up front in the C&R to compensated the IW for that FMC.

I think they did that when they deducted all of that money over the years when we where working.
It's impossible to "shift the liability to Medicare/taxpayer."
Medicare has a policy of not paying for up to the amount of the settlement.
Show me one case where medicare paid when a setaside was mismanaged, you can't because they don't.

But Medicare will if necessary, and if necessary go back to the ER/IC to recover payments.
The money people pay over their working lifetime into FICA/Medicare taxes has nothing to do with a WC claim.

Federal law (42 U.S.C. § 1395y(b)) not only establishes that Medicare is a secondary payer to WC, but also that Medicare has a priority right of recovery over any other entity to the proceeds of any settlement. To the extent that Medicare has made any "conditional payments", Medicare will recover those payments pursuant to 42 C.F.R. § 411.47.

Pursuant to 42 C.F.R. § 411.21, "conditional payments" are Medicare payments for services for which another payer is responsible, made either on the bases set forth in 42 C.F.R. § 411 subparts C through H, or because the intermediary or carrier did not know that the other coverage existed.

Those Medicare taxes are to provide health coverage for when you become Medicare eligible. Just like you pay your share of health insurance premiums for coverage your ER provides, or you purchase on your own.

That money for the setaside comes out of their wage loss settlement.
That's why the attorney fees are based on the percentage of the total settlement.

FMC does not come from the wage loss indemnity.
The reason the atty fees are based on the full amount of the C&R is just because it's a C&R/lump sum settlement. CMS does not allow any reduction of the MSA money to pay atty fees from the MSA allocation.

Bull, I know of plenty of people who haven't seen a doc in 15 years after closing their case. Future medical basically means pain pills and shots, alot of people can get by without them.
By the time most people settle, thay are sick of the doctors and the entire system, they want to be left alone.

Your right... and thats why carriers are not keen on paying out lump sums of cash for FMC where many IW's don't seek further treatment once they have the money.
And, for those IW's who are Medicare eligible, CMS wants the WCMSA.
If you need FMC, you should not close out the medical benefits in your claim.
If you are Medicare eligible and need a WCMSA, you better make sure the allocations are adequate to cover the potential FMC costs.

And the content of this thread is the very reason there is so much discussion on this subject on this board.
IC's have been screwing IW's for years on their FMC awards/settlement. IW's are quick to take the lump sum, and the carriers are only paying out to fund the MSA. There are a lot more dollars in a FMC settlement than a WCMSA.

Re: Setaside Money

Quoting inpain4days

does anyone know the amount of the "set aside money" suppose to be.and does the case has to be a certain dollar amount

NO. All MSA's are handled on a case by case basis.
One, you must be Medicare eligible. Or become Medicare eligible within 30 months of a settlement that changes you entitlement to medical treatment in the WC claim.

Two...yes, there are dollar amounts that trigger the need for CMS/Medicare review of a WCMSA proposal. Guidelines for Medicare Setasides in Lump Sum Settlementshttp://www.wcc.ne.gov/legal/medicare...guidelines.pdf. You would ONLY need a WCMSA IF there is a lump sum settlement.

Can't go further based on your information provided here. But this issue has been discussed many many times under ''Disability Benefits'' board.
More info is at www.ssa.gov or www.cms.gov or a google search.